South East Offices Investment Q3 2017

South East Office Investment Market Commentary Q3 2017

We are pleased to present our Q3 2017 South East Office Investment Bulletin.

South East office transaction volumes for Q3 2017 were £1.89bn, which represents the highest quarterly transaction volume in the last five years. Q3 2017 volumes are over triple Q2 2017 volumes and more than double the volume seen over the same period last year.Total transaction activity for the year stands at £2.86bn as at Q3, which is 29% ahead of the same period in 2016.

The increase in quarterly investment activity was led by the completion of two major business park portfolio deals, the first being TPG’s acquisition of the Arlington Portfolio, which included Hammersmith Embankment, Uxbridge Business Park, Oxford Business Park and 2 &3 Arlington Square, Bracknell. This was followed by Frasers Property acquiring a portfolio including three major South East business parks including; Watchmoor Park, Camberley (£42m); Chineham Park, Basingstoke (£142m) and Winnersh Triangle, Reading (£365m). In addition to this Frasers Property have conditionally agreed to acquire Maxis in Bracknell, however this deal is yet to complete.

Although Q3 was buoyed by two significant portfolio deals, if these are removed from the quarterly figures the quarter is still up on Q2 2017 by 90%, representing £991m. The number of transactions across Q3 2017 was 42, representing a substantial increase on the previous quarter which saw 29 deals complete. Q3 is typically a subdued quarter, however this year saw a number of high profile, and large deals transact off-market throughout the summer period. Post-election and referendum tensions have faded and the South East occupational market is performing healthily below 20,000 sq ft.